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“Economic Value Added” Approach to Value Creation and Executive Compensation  Online Webinar Course

The Key is to Align Managers with Shareholder Interests

27 November & 4 December 2024, live-online, Americas time zones

Direct your organization’s energies to maximizing company value. Learn an innovative approach to measure period performance, formulate strategies, allocate capital, pay for performance, and align managers with shareholders, all with a cohesive single-minded focus on value creation. Evaluate whether value-based management is an appropriate tool for your company, and learn what it takes to implement it.
If you are working in one of the following roles, we invite you to join us for this interactive webinar that will boost your understanding of how to align managers with shareholders in both listed and private companies:
  • CEOs, General Managers, and Business Unit heads.
  • Senior finance,  Strategy and Corporate Planning executives.
  • HR, Compensation and Performance Evaluation executives.
  • Board Members and Shareholders.
  • Private Equity Fund managers.
  • Understand value creation and why it is critical to business success.
  • Learn why this objective isn't at odds with the interests of other stakeholders.
  • Identify the steps to institute value based management and incentive compensation at your company.
  • Understand shortcomings of Economic Value Added as a stand-alone financial tool.
  • Learn the best practices in customizing your performance measurement.
  • Make the right decision-making tools available to business managers to help them make better decisions.
  • Design and build an incentive system around value creation.
  • Reconcile competitive pay imperatives of the labor market with shareholders'' return requirements determined by the capital market.
A company’s success is ultimately measured by its ability to create value for its shareholders. Successful management makes the best, most effective decisions, and doing this requires understanding what creates value.  

“Economic Value Added” is a shareholder-aligned methodology that extracts optimal value from the balance sheet, ensuring shareholders receive the value-maximizing return from executive decisions. Its use as a performance measure alone while a step forward, can’t fully close the loop aligning executives with shareholders. By introducing the innovative Economic Value Added Bonus Plan, the executive’s decision-making horizon is stretched, holding him accountable for sustainable performance. 

Properly implemented, the Bonus Plan reconciles labor market imperatives with capital market return requirements and minimizes retention risk. Key executives receive competitive compensation and shareholders receive a competitive return. Executives receive a fixed share of any excess above the target, but share the risk if targets aren’t met. Companies adopting such incentives stay with them. Benefits include the added advantage of automatic annual reset of targets without tedious budget and compensation negotiations.

The workshop teaches comprehensive understanding of transformative strategies: How Shareholder-Aligned Value-Based Management can streamline corporate management and internal governance, create value for shareholders, and place your company on a path to sustainable growth.

1. Value Based Management

How accounting fails to measure value and creates misalignment of interests.
Why Economic Value Added is a superior yardstick for decision-making.
Necessity of customized non-GAAP accounting adjustments.
Control versus alignment-driven management.
Why a tight and customized integration of measurement design and bonus plan is critical.
Core elements of Value Based Management:
     Comprehensive performance measurement.
     Decision-making support and analysis.
     Value-aligned incentive compensation.

2. Economic Value Added Bonus Plan Design

Why conventional incentive schemes fail to align managers with shareholders.
Reconciliation of competitive pay imperatives with  shareholders' requirement of a fair return.
Balancing key objectives in bonus plan design:
     Strong incentives.
     Low retention risk.
     Optimal shareholder cost.
Accountability for non-financial goals.
Bonus bank as a mechanism to customize incentive horizon.
Automatic reset of bonus plan parameters to avoid annual negotiations.
Kindly click on Download to receive the complete program details in pdf format.